First and foremost I am a free trader as long as it is fair (whatever that means).
Let’s use Aeromexico as an example. The flag carrier of Mexico. I have traveled on this airline very frequently throughout the years and even much more so in the past two/three years. Recently and very frequently, the captain of any given Aeromexico flight would come on the intercom and state the airline’s case against open skies. Very nationalistic views. You can’t blame them. Is it a thing of the past? Most Probably. The airline seems healthy with a “strong” minority partner, Delta Airlines. I like Aeromexico. I dislike Delta. Delta played very filthy political games when it came to the Export-Import Bank re-authorization and even before that. Regardless, this alliance may benefit from open skies.
For those airlines that are inefficient, well they either get ready to compete in a truly free air market or perish. Hopefully, they are ready. Free markets and free trade agreements are about being an efficient shark, an eating machine. Sharks devour. Guppies are devoured. It’s the name of the game in our world.
On this topic, we are bombarded with postings and media notes on how the consumer will benefit from the free skies agreement with lower rates (maybe) and better service (maybe again lol). As a note, the airlines, all of them, are making a killing right now due to the very, very low fuel prices. Fuel is their top expense. Airlines are raking it in.
Now that we are on topic of fuel and consumers: consumers certainly applaud 1.79 a gallon gas. Their pocketbooks are fatter. Holiday travel is cheaper, more cash in their wallets means more presents for the kiddies. All is good.
Well, not really. At the same time one reads about the low fuel prices and the benefits to the consumer, one reads about the bankruptcies and the hundreds of thousands of layoffs in the energy world. Low prices, layoffs, consumers. Consumers are laid off. Who wins? Where is my bag? What’s in your wallet? Happy Holidays.